Soluna Holdings, Inc

Unless the context requires otherwise in this Annual Report, the terms “SHI,” “Soluna,” the “Company,” “we,” “us,” and “our” refer to Soluna Holdings, Inc. together with its consolidated subsidiaries, “SDI” refers to Soluna Digital, Inc. “SCI” refers to Soluna Computing, Inc., formerly known as EcoChain, Inc., “Soluna Cloud” or “Cloud” refer to Soluna Cloud, Inc., and “SEI” refers to Soluna Energy, Inc. Other trademarks, trade names, and service marks used in this Annual Report are the property of their respective owners.

Overview

Our mission is to make renewable energy a global superpower by using computing as a catalyst.

We develop, own, and operate digital infrastructure for energy-intensive computing applications by colocating data centers with renewable energy power plants. We refer to this model as Renewable Computing™.

Renewable Computing™ is designed to address two converging market conditions: increasing curtailment of renewable energy generation and growing demand for power-intensive computing applications, including artificial intelligence (“AI”), high-performance computing (“HPC”), and Bitcoin mining. By locating our data centers near renewable generation assets, we seek to convert underutilized energy into economically productive computing capacity.

We utilize two distinct data center designs to serve different computing markets. For our Bitcoin mining and hosting business, we deploy a modular data center design optimized for flexible, large-scale digital asset operations. For AI and HPC workloads, we are developing an AI-ready data center design intended to support higher-density compute environments and customer requirements associated with advanced computing infrastructure.

Our facilities are managed by MaestroOS™ (“MaestroOS”), our proprietary software platform, which analyzes factors such as local power pricing, weather conditions, grid demand, and market signals to optimize operating performance and power consumption across our operating assets.

Our business model is intended to enhance the monetization of renewable generation assets while supporting scalable digital infrastructure growth. We work with renewable energy developers and power partners to access low-cost or otherwise constrained energy resources. Our data centers operate on a behind-the-meter basis, enabling them to draw electricity directly from the co-located renewable power plant and from the grid through the plant’s existing interconnection and substation infrastructure. By accessing both sources of power, our facilities are able to meet their energy needs while maintaining operating flexibility. In certain markets, our facilities also participate in demand response programs that support grid reliability.

A key element of our strategy is the colocation of data centers directly with renewable generation assets. By building behind the meter at renewable generation sites, we are able to access both on-site generation and existing grid interconnection infrastructure, which we believe can improve power economics and accelerate development timelines.

With a repeatable development approach and an expanding pipeline of projects, we are seeking to scale a differentiated digital infrastructure platform that supports renewable power utilization, flexible computing capacity, and long-term value creation.

We operate across multiple business lines and currently or plan to generate revenue from four primary sources:

Bitcoin Mining Business – We mine Bitcoin through proprietary operations and joint ventures at our data centers.

Bitcoin Hosting Business – We provide hosting and colocation services to third-party Bitcoin mining customers at our modular data centers.

HPC Business – Through Soluna HPC, Inc., we are developing AI-ready data center leasing and hosting capabilities for AI and HPC workloads, beginning with Project Kati 2, which is being engineered for more than 300 MW of capacity in partnership with Metrobloks, LLC ("Metrobloks").

Demand Response Business – We leverage our data center infrastructure to provide demand response services to grid operators and utilities.

In 2025, our execution strategy was centered around four key initiatives:

Project Optimization – Enhancing the profitability, operating efficiency, and customer mix of our operating data centers, while improving customer satisfaction.

Pipeline Expansion – Increasing the number of curtailment assessments completed with power partners, advancing additional projects toward shovel-ready status, and executing further project term sheets.

Launch HPC – Advancing our entry into the AI and HPC market through project development activities, customer engagement, and strategic infrastructure partnerships.

Capital Formation – Pursuing financing opportunities to support key growth initiatives, including Project Dorothy 2 (“D2”) and Project Kati.

Lines of Business

Bitcoin Hosting Business

We provide colocation and hosting services to third-party Bitcoin mining customers at our data centers. Customers typically contract for capacity based on their power requirements. Our customer base includes several large-scale Bitcoin mining operators. Contracts generally range from 12 to 24 months in duration.

We offer three primary commercial structures:

•Fixed-Fee Model – Customers pay a fixed fee based on energy consumed.

•Profit-Share Model – Customers pay a share of the profits from their mining activity, with power costs generally passed through.

•Fixed-Fee Service Agreement Model – Customers pay a fixed fee for managed Bitcoin mining capacity and hashrate over the term of the service agreement.

In 2025 and 2024, our Bitcoin Hosting Business accounted for approximately 57% and 50% of total revenue, respectively. Revenue in this business has been concentrated among a limited number of customers. In 2025, two customers accounted for 59% of hosting revenue and 34% of total revenue. In 2024, one customer accounted for 56% of hosting revenue and 28% of total revenue. That customer terminated its agreement during the fourth quarter of 2024. As of March 2025, we had replaced 100% of the lost hosting capacity with minimal operational disruption.

Bitcoin Mining Business

We engage in proprietary Bitcoin mining, a process that validates transactions and secures the Bitcoin blockchain. This process uses specialized computing equipment to solve complex cryptographic algorithms. Miners compete to solve these algorithms, and the first to do so is awarded a predetermined number of newly issued Bitcoins (the “Block Reward”), together with the transaction fees associated with that block.

We participate in one or more mining pools, which are collaborative networks of miners that combine computing power to improve the probability of earning rewards. Block Rewards earned by the pool are distributed among participants based on each participant’s proportional contribution. We believe this model reduces revenue volatility as compared to operating on a solo mining basis.

Mining operations are energy-intensive and require significant computational resources. We operate data centers using both proprietary and third-party hardware and software. MaestroOS is used to optimize performance, manage power consumption, and improve operating efficiency.

Revenue from Bitcoin mining consists of Block Rewards and transaction fees and is recognized upon receipt in accordance with applicable accounting guidance. Upon receipt, digital assets are promptly converted into U.S. dollars through the Coinbase cryptocurrency exchange.

Mining profitability is affected by several factors, including the market price of Bitcoin, global network hash rate, mining difficulty, electricity and infrastructure costs, and mining pool fees. In addition, Bitcoin undergoes a periodic halving event, approximately every four years, that reduces the Block Reward and may adversely affect future revenue. For the years ended December 31, 2025 and 2024, our Bitcoin Mining Business represented approximately 38% and 45% of total revenue, respectively.

High Performance Computing Business

Our HPC business is being developed through Soluna HPC, Inc. and is focused on data center leasing and hosting solutions for AI and other HPC workloads, with an initial target customer base of Hyperscalers and Neoclouds, and enterprise customers over time.

Unlike our Bitcoin mining and hosting operations, which use a modular data center design, our HPC business is based on an AI-ready data center design intended to support higher-density compute environments and the infrastructure requirements of AI and HPC customers.

We are currently advancing infrastructure projects intended to support AI and HPC workloads. These activities include site and feasibility studies, power and land procurement, engineering and design work, customer engagement, and evaluation of potential financing and partnership structures.

Our first planned large-scale HPC development is Project Kati 2, which is being engineered for more than 300 MW of capacity in partnership with Metrobloks. We expect Project Kati 2 to serve as the initial platform for Soluna HPC, Inc.’s leasing and hosting business. We are also advancing additional projects from our development pipeline that are in various stages of evaluation, engineering, and development.

In March 2025, we terminated our prior agreement with Hewlett Packard Enterprise Company (“HPE”), which had supported our earlier GPU-as-a-Service offering. Following that termination, we refocused our HPC strategy on the development of dedicated data center infrastructure for third-party leasing and hosting.

Demand Response Business

We provide demand response services to grid operators and utilities by using our data centers as dispatchable energy resources. In certain markets in which we operate, our data centers participate in ancillary services and other demand response programs that support grid reliability.

Under these programs, we commit to reduce a facility’s power consumption to a predetermined level when called upon by the grid operator. In return, we receive compensation for maintaining this dispatch capability, provided we satisfy applicable performance requirements. These requirements typically include minimum uptime and availability thresholds during a measurement period, which is often monthly.

For the years ended December 31, 2025 and 2024, our Demand Response Business represented approximately 4% and 6% of total revenue, respectively.

Operations and Project Pipeline

As of December 31, 2025, we operate approximately 123 MW of capacity across two active sites located in Murray, Kentucky and Silverton, Texas. An additional 83 MW is under construction and 100+ MW is in development at our Kati project site, and as of December 31, 2025, we had over 900 MW of facilities in advanced development or near shovel-ready status. In total, our project pipeline includes approximately 4.3 gigawatts (GW) of renewable energy-powered data center developments.

A summary of our pipeline, current and anticipated operating locations are as follows (as of December 31, 2025):

We manage our data center operations using MaestroOS. MaestroOS continuously monitors and analyzes a variety of real-time signals, including local electricity prices, weather conditions, Bitcoin market metrics, and grid demand signals, to optimize facility performance. In addition, MaestroOS is used to coordinate and execute our participation in demand response programs.

We finance the development and construction of our data centers through a combination of public equity offerings, debt instruments, and partnerships with project-level capital providers. As of December 31, 2025, we had four primary project-level financing partners:

•Spring Lane Capital (“SLC”) – a private venture capital firm with approximately $450 million in assets under management, focused on sustainability-oriented infrastructure. On May 3, 2022, SLC committed $35 million to finance Soluna’s Project Dorothy 1A (“D1A”). On July 22, 2024, SLC committed an additional $30 million to support the development of D2. On July 22, 2025, SLC committed $20.0 million for the first phase of the construction on Project Kati, subject to customary conditions.

•Navitas West Texas Investments SPV, LLC (“Navitas”) – an investment vehicle organized by Navitas Global, a private equity firm focused on sustainable Bitcoin mining. On May 9, 2023, we entered into a strategic partnership with Navitas to support mining operations at Project Dorothy 1B (“D1B”).

•Galaxy Digital, LLC (“Galaxy”) –a financial services and investment management innovator in the digital asset and blockchain technology sectors. On March 12, 2025, Soluna SW LLC (the “SW Borrower”), a Delaware limited liability company and subsidiary of Soluna SW Holdings LLC (“SW Holdings”, and together with the SW Borrower, the “SW Loan Parties”), entered into a five-year term loan facility in the principal amount of $5.0 million.

•Generate Capital (“Generate”)– a leading infrastructure investment firm. On September 12, 2025, we entered into an up to $100.0 million credit facility with Generate, and as of December 31, 2025, we had drawn approximately $17.0 million to fund refinancing and construction of active data center projects.

Project Dorothy

During 2023, we transitioned our flagship data center Project Dorothy from construction to operations. This data center is co-located with Briscoe Wind Farm (“Briscoe”), a 150 MW wind power generation facility in Silverton, Texas. The project comprises three phases: D1A (25 MW), and D1B (25 MW), and D2 (48 MW).

Project Dorothy is registered in one of the ERCOT’s Demand Response Services (“DRS”) programs. This designation positioned Project Dorothy as a contributor to grid flexibility and resilience in the Texas power market, while also enabling us to diversify our revenue streams.

Under the DRS program, we commit to maintaining a specified level of curtailment capacity—measured as load reduction availability—on a monthly basis. When called upon by ERCOT, we are required to reduce the facility’s power consumption by the committed amount. In exchange, we receive compensation for maintaining this curtailment readiness, regardless of whether an actual dispatch occurs.

Participation in the program allows us to generate incremental revenue and offset power costs at Project Dorothy, enhancing its cost-efficiency. As a result, the facility ranks among the lowest-cost operators in the sector.

Project Dorothy 1A

D1A is focused on Bitcoin Hosting for some of the industry’s hyperscale miners. For 2025, D1A completed all customer deployments and executed fleet upgrades across multiple hosting partners, driving measurable hashrate growth throughout the year.

D1A was constructed in partnership with SLC, a leading venture capital firm focused on sustainability solutions. SLC owns approximately 85% of the Class B Membership Units of D1A, while we own 15% of the Class B Membership Units of D1A and own 100% of the Class A Membership Units of D1A. After SLC achieves an 18% Internal Rate of Return hurdle, Soluna retains 50% of the profits on D1A.

Project Dorothy 1B

D1B is focused on proprietary Bitcoin Mining. D1B is co-owned by Navitas, which owns approximately 49% of D1B, while we own the remaining 51%. In 2025, fleet consolidation and reinvestment at D1B resulted in the deployment of 1,000 upgraded S19 XP miners, delivering hashrate gains and a strong competitive position heading into 2026.

Project Dorothy 2

Project Dorothy 2 is a 48 MW expansion of the Company’s Dorothy campus, which construction and commissioning were completed in 2025. The project was developed and energized in three phases (16 MW, 14 MW, and 18 MW), with initial commissioning beginning in the first quarter of 2025 and each phase brought online sequentially throughout the year, enabling customer deployments and revenue generation upon energization. By mid-August 2025, 32 MW was operational, with the remaining capacity commissioned in the fourth quarter. Construction was completed in November 2025, and the facility transitioned to full operations with all capacity deployed, operating at full capacity for the first full month in December 2025. Project Dorothy 2 is fully contracted with a mix of new and existing customers, including Blockware, Compass Mining, and a large-scale mining partner, and generates revenue through Bitcoin hosting and participation in demand response programs. D2 features a superior financial waterfall structure and enhanced management and development fees for Soluna compared to D1A, allowing us to benefit from improved income once the facility is operational.

Project Grace

Project Grace is a 2 MW project located at the D2 site focused on next generation data center designs for AI. It contemplates new direct liquid cooling technologies, proprietary building and power designs – called Helix. The Company is collaborating with Siemens, a leading technology company in electrification, automation and digitalization, to develop solutions addressing power demand fluctuations associated with AI workloads.

Project Sophie

Project Sophie is a 25 MW data center, based in Murray, Kentucky connected to the grid (“Sophie”). The project has a Power Purchase Agreement (“PPA”) that requires the curtailment of the site during certain hours of the day to help balance the Kentucky grid. We own 100% of the facility, which was completed in 2021.

Sophie is focused on Bitcoin Hosting of multiple large customers. The data center generates revenue via a combination of fixed services fees and profit share, while energy cost is passed through. During 2025, Sophie completed three consecutive expansion agreements with long-standing hyperscale mining customers, reflecting sustained demand and high satisfaction with our hosting customers. In addition, Sophie closed a new 3.3 MW partnership with KULR Technology Group in October 2025, diversifying the customer base and expanding the site's renewable-powered computing footprint.

Project Kati 1

Project Kati 1 is the first phase of the Company’s data center campus under development in Willacy County, Texas, co-located with a 272.6 MW wind farm. Project Kati 1 comprises 83 MW dedicated to Bitcoin hosting. Construction began on September 18, 2025, and on July 22, 2025, the Company finalized a contribution agreement with Spring Lane Capital for the initial 35 MW of capacity, with initial energization expected in the first half of 2026. Galaxy Digital has been secured as the initial customer for the project.

Project Kati 2

Project Kati 2 is the second phase of development at the Company’s Kati site in Willacy County, Texas, and is focused on supporting AI and high-performance computing workloads. The project is being advanced through a joint venture with Metrobloks to develop an initial phase of 100 MW+ of AI and HPC capacity, with the potential to expand to a larger multi-hundred-megawatt deployment. The campus is designed to leverage behind-the-meter integration with renewable energy and support customers requiring large-scale, high-density compute infrastructure with accelerated time to power.

Project Rosa

We are developing Project Rosa in Snyder, Texas, which is expected to be up to 187 MW of data center capacity for AI and Bitcoin Hosting and other computing-intensive applications. It will be co-located with a 242.5 MW wind farm. We have signed term sheets for both power and land purchase agreements in connection with this project.

Project Hedy

We have signed a term sheet for power for Project Hedy, a new 120 MW data center co-located with a 200 MW wind farm in South Texas. The wind farm is owned by a new power partner–a multinational conglomerate that focuses on developing and managing sustainable infrastructure solutions, with a strong emphasis on renewable energy, water management, and services, aiming to contribute to a low-carbon economy and a better planet.

Project Ellen

We have signed a term sheet for power for Project Ellen, a new 100 MW data center co-located with a 145 MW wind farm in South Texas. The wind farm is owned by a new power partner—a leader in renewable energy and sustainable infrastructure both in the U.S. and internationally. Project Ellen will be developed in two 50MW phases, leveraging wind energy to drive sustainable computing at scale.

Project Annie

We have signed a term sheet for power for Project Annie, a new 74 MW data center which will be co-located with a 114 MW solar farm in Northeast Texas. The solar farm is owned by a new power partner–a leader in renewable energy and sustainable infrastructure both in the U.S. and internationally.

Project Fei

We have signed a term sheet for power for Project Fei, a 100 MW data center in development which will be co-located with a 240 MW utility-scale solar farm, Soluna’s second solar-based project to date. Being developed in partnership with a global leader in energy infrastructure investment, Project Fei will convert underutilized solar energy into clean, high-performance computing power. The project is currently advancing through land acquisition, power contract negotiation, and ERCOT interconnection planning.

Project Gladys

We have signed a term sheet for power for Project Gladys, a 150 MW facility in development which will be co-located with a 226 MW wind farm and developed in partnership with a prominent U.S.-based independent power producer managing over $40 billion in assets and more than 80 energy facilities nationwide. The project is currently advancing through land acquisition, power contract negotiation, and ERCOT interconnection planning.

Our Growth Strategy

Our growth strategy is focused on expanding our pipeline of renewable energy-powered data center projects and accelerating their development through joint ventures, co-ownership structures, and other strategic partnerships. Over time, we intend to increase our ownership stake in these projects to enhance long-term value.

Our renewable energy project pipeline—currently estimated at over 4.3 gigawatts (GW)—represents our most valuable strategic asset. We believe this pipeline has the potential to support the development of over 300 MW of new digital infrastructure annually over the next six to eight years.

In parallel with new project development, we are refining our operational model across existing sites to position ourselves as a partner of choice for both AI/HPC colocation and Bitcoin Hosting.

We continue to grow our pipeline by increasing the number of Curtailment Assessments completed with power generation partners. These assessments serve as a precursor to securing exclusive power purchase agreements (PPAs), acquiring or leasing land, and executing other pre-construction development activities necessary to advance projects to shovel-ready status.

In 2026, we are focused on advancing the following key initiatives:

•Grow Pipeline: Expand Soluna’s Renewable Computing(™) pipeline by advancing projects in our 4.3 GW+ power pipeline to shovel-ready status and securing behind-the-meter access to curtailed energy resources. Enable scalable capacity with accelerated speed to power.

•Develop AI: Advance Project Kati 2 with Metrobloks to shovel-ready and tenant-ready. Build a pipeline of AI-ready campuses designed for rapid deployment from the 4.3GW+ pipeline through joint ventures.

•Optimize Projects: Energize Project Kati 1. Enhance profitability across operating data centers through higher uptime, operational efficiency, and disciplined cost management, thereby strengthening long-term asset value and improving overall customer satisfaction.

•Capital Formation: Executing a disciplined capital strategy to fund pipeline growth, AI data center development, and construction. Leveraging project-level financing and strategic capital partnerships to scale data center development while maintaining balance sheet flexibility.

Competition

We operate in a highly competitive sector characterized by a growing number of participants and increasing capital investment. Our approach to sourcing renewable energy focuses on curtailed or underutilized power, which is typically priced below market rates. This enables us to offer competitively priced, sustainability-aligned computing solutions.

We believe one of our key strategic advantages is our model of co-locating data centers directly with renewable power generation assets. By building behind the meter, we are able to bypass long interconnection queues and source electricity directly from the generation site. This structure not only improves power economics, but also accelerates time-to-market—an increasingly important factor for companies with large, time-sensitive computing workloads such as AI and HPC.

We believe this combination of low-cost power access, grid efficiency, and sustainability focus positions us as a differentiated provider in the digital infrastructure space.

Our emerging HPC Business competes with leading data center firms such as Applied Digital, Digital Realty, NeoCloud companies such as Crusoe, CoreWeave, Lambda, FluidStack and Nebius. While some of these companies are much larger than we are today, we believe our competitive advantage lies in our ability to source renewable energy for the growth of this business faster and at better costs than our competitors.

Our Bitcoin Hosting Business competes with a large number of other hosting operators. We compete with public and private companies including: BitFuFu, Canaan, Cango, Blockstream, Blockware (who we have a dual relationship with), Foundry, Compass Mining (who we have a dual relationship with), Hut 8, Bitdeer, and Core Scientific. Our success in our hosting operations depends on our ability high quality data center facilities, best-in-class services, and industry leading power prices.

Our proprietary Bitcoin Mining Business competes globally to complete new blocks and earn Bitcoin rewards.

We may compete with the following publicly traded Bitcoin mining companies: Riot Platforms, Marathon Digital Holdings, Core Scientific, Cipher Mining, Hut 8 Mining, Hive Blockchain Technologies, Bitfarms, Bitdeer Technologies Group, Cleanspark, IREN, Bit Digital, TeraWulf, and Greenidge Generation Holdings.

Key competitive factors include our number of miners, mining difficulty, operational efficiency, and the fiat value of rewards. Bitcoin mining has shifted from individual participants to large-scale, industrial facilities. Mining pools allow participants to combine processing power and share rewards based on contributed hash power. We also compete for new miners, capital, and technological advancements to enhance mining efficiency.

Many of our competitors offer more locations in more markets worldwide and have well-established international operations. Many of our competitors may have significant advantages over us, including greater name recognition, longer operating histories and higher operating margins, pre-existing relationships with current or potential customers, the capacity to provide the same or additional products and services at a lower cost, more significant marketing budgets and other financial and operational resources, more robust internal controls and systems, and better established, more extensive scale and lower cost suppliers and supplier relationships.

We face significant competition from our competitors, and we expect such competition to continue to increase, which could significantly harm our business, financial condition, and results of operations. If we cannot compete successfully against our current and future competitors, we may not be able to retain and grow our customer base, and our business and prospects may be harmed.

Intellectual Property

We seek protection for our intellectual property as appropriate. To establish and protect our proprietary rights, we rely upon a combination of patent, copyright, trade secret and trademark laws and contractual restrictions such as confidentiality agreements and intellectual property assignment agreements.

As of the date of this Annual Report, Soluna has two issued US patents, three pending US patent applications with the U.S. Patent and Trademark Office, and four pending non-US patent applications. The non-US jurisdictions include Australia, Canada, China, European Patent Office ("EPO"), and Japan. Among other things, concepts in these patents/patent applications generally relate to modular architecture, cooling technology, data center control, simulation, variable power consumption and local co-optimization of power generation supply with demand. Specifically, the two issued patents

(US11,974,415 and US12,250,794) focus on the layout of modular data center buildings on a site, which is crucial for thermal efficiency.

We meet regularly with IP counsel to manage the portfolio and determine strategies to pursue protection of additional technologies. We maintain company policies requiring our employees, contractors, consultants and other third parties to enter into confidentiality and proprietary rights agreements to control access to our proprietary information. While there is no assurance that our pending applications will result in issued patents, we believe that our intellectual property portfolio provides us with a competitive advantage in our industry.

We also rely on trade secrets, proprietary know-how, and contractual agreements to protect our technology. However, our ability to maintain and enforce our intellectual property rights may be subject to challenges, including the risk of third-party disputes, opposition proceedings, and evolving patent laws in various jurisdictions. Loss of key patent rights or failure to obtain additional protections could adversely impact our business and competitive position.

We also hold a registered trademark for our Company name, Soluna.

We have developed a proprietary software system called MaestroOS™ to enable the automation, management, and operations of critical elements of our data centers. We have a dedicated team that engages in activities to continue to enhance the MaestroOS to drive innovation and growth in its business. MaestroOS incorporates software components licensed to the general public under open-source software licenses. We obtain many components from software developed and released by contributors to independent open-source components of our platform. Open-source licenses grant licensees broad permissions to use, copy, modify and redistribute those open-source components of our platform. As a result, open-source development and licensing practices can limit the value of our software copyright assets.

Environmental

Data centers, including those used for Bitcoin mining and AI workloads, are receiving increasing scrutiny regarding energy usage, carbon intensity, water consumption, land use and grid impacts. We seek to mitigate these concerns by colocating flexible computing loads with renewable energy resources and designing our facilities to use power and water more efficiently. However, the environmental benefits of our model may vary over time and depend on factors outside our control, including renewable resource availability, curtailment patterns, grid conditions, operating patterns and third-party assumptions and methodologies.

We may also face changing environmental laws, permitting requirements, water-use restrictions, emissions standards, climate-related disclosure obligations and other regulatory requirements that could increase costs, delay projects, require additional capital expenditures or limit operations. In addition, extreme weather, drought, heat, flooding and other climate-related events could reduce power availability, impair cooling efficiency, limit water access or disrupt our facilities. As AI and other high-density computing workloads expand, concerns over energy and water use may intensify, which could lead to additional public scrutiny, adverse publicity, permit challenges or operating restrictions. If we are unable to manage these risks effectively, our business, financial condition and results of operations could be materially adversely affected.

Existing or Potential Governmental Regulations

Cryptocurrency mining and related large-load computing activities are subject to an evolving regulatory framework at both the federal and state levels. Although the United States has not adopted a comprehensive federal statute governing cryptocurrency mining, federal and state agencies, grid operators, and policymakers have increased their focus on digital assets, electricity consumption, grid reliability, interconnection, environmental impacts, and related infrastructure planning. As a result, the regulatory environment applicable to our business is becoming more active and, in some respects, more prescriptive. The impact of future legislation, rulemaking, market rules, or enforcement actions on our operations remains uncertain and may vary by jurisdiction.

A substantial portion of our operations, including our Project Dorothy facilities, are located in Texas, which has historically maintained a comparatively favorable environment for digital asset mining and other large flexible loads. At the same time, Texas has increased its oversight of these facilities. In particular, Texas law and Public Utility Commission of Texas (“PUCT”) rules now require certain virtual currency mining facilities in the ERCOT region that receive retail electric service and meet specified large-load and interruptibility thresholds to register with the PUCT. Existing facilities subject to the rule were required to register by February 1, 2025, and new facilities generally must register promptly after beginning service. In addition, ERCOT and the PUCT continued during 2025 and early 2026 to evaluate and refine interconnection processes for large loads, including potential batch-study frameworks and related rule revisions intended to address study efficiency, transparency, cost allocation, and system reliability. These processes may affect the timing, cost, operating flexibility, or energization of existing and future projects, and we may experience delays or additional compliance burdens as those requirements evolve.

At the federal level, policy developments in 2025 generally reflected a more supportive posture toward digital assets and domestic infrastructure buildout, but they also signaled the potential for increased oversight. In January 2025, President Trump issued an executive order directing a federal working group to recommend a regulatory framework for digital assets. In March 2025, the President issued an executive order establishing a Strategic Bitcoin Reserve and a United States Digital Asset Stockpile. In July 2025, the White House released the working group’s report on digital financial technology. During the same period, the federal government also increased its focus on electricity demand growth and infrastructure associated with large computing loads. For example, FERC in February 2025 initiated proceedings addressing colocation arrangements involving large loads such as AI-enabled data centers, and later opened a rulemaking process addressing the interconnection of large loads to the interstate transmission system, including questions regarding upgrade costs, reliability standards, and treatment of pending requests. Separately, the White House and the Department of Energy launched initiatives in 2025 aimed at accelerating permitting and power infrastructure needed to support AI-related demand growth. While many of these developments may benefit large-scale computing infrastructure, they could also result in new requirements, changed cost-allocation rules, expanded reporting obligations, or longer development timelines.

Although recent federal policy signals have generally been constructive for digital assets and large-scale computing infrastructure, the long-term regulatory trajectory remains uncertain. Other jurisdictions have taken or may take a more restrictive approach. For example, New York has continued to examine the environmental impacts of proof-of-work mining following its prior restrictions on certain fossil-fuel-based mining activity. We do not operate in New York, but similar legislation, permitting restrictions, environmental review requirements, grid-related rules, or market reforms in Texas or other jurisdictions could materially increase our costs, limit our operating flexibility, delay development, or otherwise adversely affect our business, financial condition, and results of operations. We continue to monitor legislative, regulatory, and market-rule developments at the federal, state, and ERCOT levels. For additional information on regulatory risks, see the section titled “Risk Factors” in this Annual Report.

Human Capital Resources

As of December 31, 2025, we had fifty-five (55) employees, including fifty-one (51) full-time employees, one (1) part-time employee, and three (3) full-time consultants. Of these employees, thirteen were in finance, twenty-six in operations, two in marketing, two in corporate development, six in information technology and engineering, two in human capital, two in power, and two executives. The operations personnel include both individuals directly involved in the strategy of our data centers as well as data center maintenance and supervisory roles. Certain positions within our organization require industry-specific technical knowledge. We have been successful in attracting and retaining qualified technical personnel for these positions.

None of our employees are subject to a collective bargaining agreement and we believe our relations with our employees to be positive, as reflected in our low voluntary turnover rate.

Diversity, Equity, and Inclusion

We support diversity and inclusion by ensuring a workplace where employees can thrive, and our policies are designed to promote equality and respect for everyone. Diverse backgrounds, experiences and opinions are encouraged and welcomed. In support of such diversity and inclusion, we act in accordance with our Code of Ethics and Business Conduct and our Non-Discrimination and Anti-Harassment Policy to create a safe environment free from discrimination or harassment that respects the human rights of our employees. We strive to achieve a workplace where opportunities for success are created and available for everyone equally.

Company History, Information and Organization

Soluna Holdings, Inc. (“SHI”), formerly known as Mechanical Technology, Incorporated, which was originally incorporated in the State of New York in 1961, reincorporated in the State of Nevada on March 24, 2021, and is headquartered in Albany, New York. Effective November 2, 2021, the Company changed its name from “Mechanical Technology, Incorporated” (or “MTI”) to “Soluna Holdings, Inc.” On October 29, 2021, Soluna Callisto Holdings, Inc. merged into Soluna Computing, Inc. (“SCI”), a private green data center development company and a subsidiary of SHI. MTI Instruments, Inc., a subsidiary of SHI, was sold on April 11, 2022. On March 23, 2021, our common stock commenced trading on the Nasdaq Stock Market LLC (“Nasdaq”). We formed a wholly owned subsidiary of SHI on December 31, 2023, Soluna Digital, Inc. (“Soluna Digital,” or “SDI”). Effective December 31, 2023, SCI transferred substantially all of its assets to SHI or its subsidiaries, including SDI.

Additional Information

We file or furnish periodic reports and amendments thereto, including our annual reports on Form 10-K, proxy statements, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and other information with the SEC. These reports, and any amendments thereto, as filed with the SEC, can be accessed, free of charge, on the SEC’s website www.sec.gov. These documents may also be accessed on our website: http://www.solunacomputing.com through a link in the “Investors” section. The contemplated documents are placed on our website as soon as practicable after their filing with the SEC. The information posted on our website is not incorporated by reference into this Annual Report.